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Since at least 2002, Beijing has emphasized a policy of going global for state-owned enterprises, as well as, privately-owned domestic enterprises, that has led to over $68 billion of outward foreign direct investment from China. Outward foreign direct investment has been speculated as one possible medium for Beijing to exert soft power or engage in economic diplomacy, yet there is scant analysis on how OFDI has affected the Asia-Pacific regional geopolitical environment. This thesis attempts to bridge this gap in understanding by analyzing the economic effect of Chinese OFDI actions and presenting the historic and current scope of Chinese OFDI, interpreting Chinese OFDI through the lens of economic theory and realist theory, and tracking the changes in the geopolitical environment in the Asia-Pacific region since 2002 on a country-by-country basis. Overall, Chinese OFDI appears to be mostly in line with economic theory and has provided modest benefits to the Chinese economy, but there have been inconsistent and unpredictable shifts in the geopolitical environment in the Asia-Pacific region during Chinas Go Global campaign.

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